The proposition that the Fed should concentrate on price stability rather than reducing unemployment is
A. generally accepted by politicians, although few economists accept this proposal.
B. largely accepted by most economists, although politicians do not agree.
C. highly debatable because many do not agree that price stability should be the most important goal.
D. simply incorrect, and no one accepts this idea anymore.
Answer: C
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What will be an ideal response?
Within the balance of payments, a current account deficit is offset by a:
A) financial account deficit. B) financial account surplus. C) budget deficit. D) budget surplus.
Savings are good for a family. If all families increase savings, the economy is better off. This fallacy of composition is called:
a. the paradox of time. b. the paradox of dissaving. c. the paradox of thrift. d. the paradox of value. e. the paradox of choice.
E&S Cooling Co. installs air conditioning systems in new houses for homebuilders and replacement systems for homeowners. Sales of which systems are included in this year’s GDP?
A. Sales of replacement systems B. Sales of both systems C. Sales of systems in new houses D. Neither system would be included, because they are always intermediate goods